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Facts
The appellant, a religious institution registered under Section 12A, filed a Nil income return for AY 2023-24, claiming exemption under Section 11 for Rs. 2,00,000 of accumulated funds not utilized during the Covid-19 pandemic. The CPC, processing under Section 143(1), denied this exemption, and the CIT(A) upheld this denial.
Held
The Tribunal ruled that the CPC was not justified in invoking Section 11(3) for disallowance of accumulated funds during processing under Section 143(1), as such an adjustment falls outside the ambit and scope of Section 143(1) of the Income Tax Act. The CPC was directed to amend the intimation.
Key Issues
Whether invoking Section 11(3) to deny exemption for non-utilized accumulated funds is permissible during the processing of a return under Section 143(1) of the Income Tax Act.
Sections Cited
12A, 11, 143(1), 11(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, COCHIN
Before: Shri Inturi Rama Rao
Asst.Year 2023-2024 St.Josephs Church Neduvaloor The Income Tax Officer Changalai PO v. Exemption Ward Sreekandapuram Kannur. Kannur- 670 631. PAN : AACAS8854R. (Appellant) (Respondent) Appellant by : --- None --- Respondent by : Smt.Leena Lal, Sr.AR Date of Date of Hearing : 26.03.2025 Pronouncement : 08.04.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Assessment Centre / Commissioner of Income- tax (Appeals) [“CIT(A)” for short] dated 30.01.2025 for the assessment year 2023-2024.
Brief facts of the case are that the appellant is a religious institution duly registered u/s.12A of the Income-tax Act, 1961 (“the Act”). The return of income for the assessment year 2023-204 was filed on 14.12.2023 disclosing Nil income after claiming exemption u/s.11 of the Act. The said return of income was processed u/s.143(1) of the Act vide intimation dated 02.12.2024 denying the claim for exemption u/s.11 of the Act to the extent of Rs.2,00,000 being the amount set apart
Being aggrieved by the above assessment order, the appellant filed an appeal before the CIT(A), who vide the impugned order confirmed the action of the Assessing Officer (“the AO”).
Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal. When the matter was called upon, none appeared on behalf of the assessee despite due service of notice. Therefore, I proceed to dispose of the appeal after hearing the learned Senior DR.
I heard the learned Sr.DR and perused the material available on record. The issue that arises for my consideration is whether while processing the return of income u/s.143(1) of the Act, the CPC was justified in invoking the provisions of section 11(3) of the Act for non- utilisation of accumulated funds carried forward from the previous years. On a carefully perusal of the provisions of section 143(1) of the Act, the said addition does not fall within the ambit and scope of sec.143(1). Accordingly, the CPC is directed to amend the intimation. It is ordered accordingly.
In the result, the appeal filed by the assessee stands allowed. Order pronounced on this 08th day of April, 2025.